China Pledged to Cease Creating Overseas Coal Plants. How Does This Affect Southeast Asia?

Many countries where Beijing has committed to projects say coal plants are needed to ensure affordable, reliable energy

 

In 2021, China pledged to cease constructing coal plants abroad. As analyzed in the article China Swore Off Overseas Coal Plants. Is Xi Keeping His Climate Promise? written by Sha Hua, China’s recent actions have led to questions by critics of this pledge and outrage from coal-dependent countries. In 2023 it has been reported that China has been working with Pakistan as well as Indonesia to continue old plans of constructing new coal plants. While this is devastating news for environmental activists who argue for the reduction of carbon dioxide emissions as a byproduct of such coal plants, many developing countries such as Indonesia and Laos rely on such sources of energy as capital investment that are stable and financially feasible; While many environmental activists call for the development of renewable energy construction in place of coal plants in such countries, many developing countries say that they are not prepared to make such a transition as the capital required is egregious. As stated in the article by Hua, “The International Renewable Energy Agency estimated in 2022 that Indonesia would require more than $400 billion for its renewable energy technology, grid expansion and storage needs through 2023.” In the case of Indonesia, a major hub of production for the processing of nickel ore used in producing electric car batteries, they rely on these coal plants to run factories and stabilize the economy. A switch to renewable energy in Indonesia could mean extensive costs that the country is unable to provide at its current economic state. 

 

In a similar sense, Laos is dependent on fossil fuels to expand its economy. The country has been working to develop hydropower to export sustainable energy to neighboring countries as a means of growth. Still, the country is dependent on coal plants to ensure these processes. Laos faces wet and dry seasons; during these dry seasons, hydropower is not an option. This means that the country is forced to import electricity from one of its neighbors, Thailand, at double the cost. Laos was dependent on the promise of Chinese coal plants which were to be built in an attempt to export electricity to Cambodia. Without these coal plants, it is uncertain what the impact will be on the country and its civilians. As anthropologist Leah Zani analyzed in her research on post-war expansion in Laos following the devastating Vietnam War, large economic change has a substantial impact on civilians especially in connection with industrial development. This begs the question of how civilians will respond to economic retraction if coal plants are not funded.

A coal plant in Cilegon, Indonesia. Indonesia’s government wants new coal plants to provide energy for processing nickel, used to make batteries for electric cars. PHOTO: ADITYA IRAWAN/ZUMA PRESS